Tax on Dividends From Foreign Subsidiary Reduced to 15%

The rate of tax on dividends received by an Indian company from its foreign subsidiary has been lowered to 15% for improving flow of such funds into India.

The weighted deduction on payments made to National Laboratories, Universities and Institutes of Technology, for scientific research has been enhanced to 200% from the earlier 175%.

The Finance Minister has also announced the creation of special vehicles in the form notified infrastructure that funds to attract foreign funds for financing of infrastructure. Interest on the borrowings of these funds will be subject to a reduced to with holding tax rate of 5% instead of the current 20%. The income such funds will be exempt from tax.

Source : Equity Bulls

Keywords